Council overturns FTT decision on timing of 'fit and proper' test

The London Borough of Waltham Forest has won an appeal against a First-tier Tribunal (Property Chamber) ruling on how it revoked landlords’ licences.

This turned on whether the tribunal should have considered whether someone was a ‘fit and proper person’ at the time of the original decision or at the time of the appeal.

Court of Appeal judges held that the tribunal should have looked only at the facts as they were at the time of Waltham Forest’s decision.

Owner Nasim Hussain was convicted of property management offences and the council revoked her licences. It concluded her family was involved and also revoked licences and refused licence applications made by her daughter, Farina Hussain, and the latter’s company, FHCO.

Andrews LJ said in her judgment that the appeal raised “important issues of principle concerning the nature and scope of the statutory jurisdiction of the First-tier Tribunal (Property Chamber) on an appeal from a licensing decision made under Parts 2 and 3 of the Housing Act 2004”.

She said the key issue was whether, as the Upper Tribunal (Lands Chamber) held, when hearing such an appeal the FTT makes its own assessment as to whether, on the date of the appeal, someone is a ‘fit and proper person’ to hold a licence; or whether, as Waltham Forest contended, the task of the FTT is to determine whether a local authority decision was wrong, and therefore to consider whether the individual concerned was a ‘fit and proper person’ on the date the decision was made.

Andrews LJ said: “I have concluded that the UT was wrong to find that it was open to the FTT to decide the appeal by addressing fitness and propriety as at the date of the appeal.

“Moreover it was wrong to do so on the basis of material that did not exist at the time of the decision and which could not possibly have been relevant to the question whether the council’s refusal or revocation of the licenses in November 2018 was wrong.”

The judge said it was plain that the FTT only regarded FHCO as a ‘fit and proper person’ to hold a licence “because of matters that had occurred after the decision under appeal was taken, including the appointment of a second director”.

She said the FTT “took into account irrelevant matters arising after the decision (such as her more recent property management track-record, when compared with that of her mother) when considering Farina [Hussain]’s own appeal”.

Andrews LJ further stated that the FTT “failed to afford sufficient deference to the council’s decision and the reasons for it”.

She added: “The FTT might have been entitled to reach the conclusions that it did, if it had properly directed itself; but it did not properly engage with the material which underpinned the council’s decision and therefore wrongly assumed that it was based on speculation rather than hard evidence which the council was best placed to assess.”

Allowing the council’s appeal, Andrews LJ concluded: “The correct legal approach and assessment of the relevant evidence would have resulted in the dismissal of Farina’s and FHCO’s appeals to the FTT.

“Farina failed to show that the council’s decision to revoke her licence was wrong at the time when it was made.”

He said Farina Hussain “had been afforded ample opportunity to explain her position within the family business, and had chosen not to do so”, and confirmed the council’s decisions to revoke Farina Hussain’s licence and refuse to grant licences to FHCO.

Snowden LJ and Lewison LJ both agreed with the judgment.

Commenting on the decision, Riccardo Calzavara of Cornerstone Barristers, who was junior counsel for the council, said: “The Court of Appeal has held that when conducting an appeal from the local housing authority’s decision to refuse or revoke a penalty, the First-tier Tribunal (Property Chamber) is to consider whether the authority’s decision was wrong only by reference to facts that existed at the time of its decision.”

Mark Smulian